The Source

Pandering PAUL

Can it be any more apparent that Paul Levota is jockeying to be the Regional Head of the Small Business Administration? Levota will be one of 60+ state legislators meeting with the Obama Administration on Friday. For those of you who are not familiar with these briefings, basically, a bunch of state legislators are called to the White House to hear a canned 5 minute speech from the President in the auditorium of the Old Executive Office Building and then are stuck the rest of the afternoon with some Deputy Secretary of dog-catching. On an impressive scale, Levota’s visit does not even register.

Why then would Levota do an all out media blitz? Well, a huge chunk is probably the ego he can barely contain, and the other piece is the persistent rumor that he has been lobbying hard to attain the top Regional Small Business Administration Post, a position which he is just not going to get. I mean, what qualifications does he have to help lead the country out of our current financial crisis? NONE…

Even more puzzling is the fact he was even invited. I mean, Mr. President, Levota did not even support your candidacy until he absolutely had too. He was a staunch Clinton supporter and begrudgingly came on the bandwagon when it became the ‘popular” democrat thing to do.

Nice try Paul.

Surprise --- Surprise: Bailout Money for AIG Goes Overseas

The Politico reported late last night that billions of dollars used to bailout AIG has gone to secure the footing of banks overseas. This is a huge set-back to the Obama Administration and the Democrat party, as the sole purpose of these bailouts was to help American banks who will in-turn start making sound loans that will help revitalize the economy. Now, we are learning billions were pumped into the largest foreign banks across the globe instead of providing help to banks here in the United States.

From the Politico:

AIG ships billions in bailout abroad
By: Eamon Javers
March 15, 2009 07:40 PM EST

Billions of American taxpayer dollars used to bailout insurance giant AIG are flowing to some of the largest foreign banks in the world, according to new documents released by beleaguered company Sunday.

The revelation seemed sure to cause political complications for President Barack Obama and his economic team, already on the defensive Sunday over why they couldn’t stop AIG from doling out $165 million in bonuses to some of its top corporate officials – even as the company was receiving a massive infusion of taxpayer funds.

The documents AIG released account for some of the more than $180 billion in aid that AIG has received, and they detailed for the first time which financial firms are benefitting from the federal handout.
In all, AIG disclosed payments of $105.3 billion between September and December 2008. And some of the biggest recipients were European banks. Societe Generale, based in France, was the top foreign recipient at $11.9 billion, Deutsche Bank of Germany got $11.8 billion and Barclays, based in England, was paid $8.5 billion.

Here in the U.S. , Goldman Sachs received $12.9 billion. Edward Liddy, the government-installed CEO of AIG, sat on the board of directors of Goldman Sachs until he joined AIG.

He took the position while President Bush's Treasury Secretary, Henry Paulson—who until joining the administration had served as Goldman's Chairman and CEO—arranged the insurance company's initial government bailout.

The disclosure of US taxpayer money going to foreign banks rankled some analysts. “These revelations raise serious questions about the extent to which U.S. taxpayers are being asked to bail out foreign banks,” said James Rickards, the Senior Managing Director for Market Intelligence at Omnis, an applied research organization. “Why were French and German authorities not asked to pick up the tab for their portion of potential AIG losses?”

Political pressure is also building on AIG, as House Speaker Nancy Pelosi on Sunday called on AIG executives to “renounce” their bonuses and refuse retention pay, and said that House Financial Services Chairman Barney Frank would “examine options that are legally available to recover taxpayer funds of companies that abuse the privilege of taxpayer assistance.”

The House Financial Services Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises has called on Liddy to testify before the committee on Wednesday.

That’s information that members of Congress and media outlets have been trying to get either AIG or the federal government to divulge since last year. The U.S. government now holds a majority stake in the bank,

AIG has resisted disclosure of the so-called “counterparties” who were at the other end of the firm’s complicated financial transactions. The company argued that such information was proprietary and private. And the Bush and Obama administrations also declined to divulge the information. But some in Congress pushed hard for it, insisting that taxpayers had a right to know which companies were benefiting from bailout money.

“Our decision to disclose these transactions was made following conversations with the counterparties and the recognition of the extraordinary nature of these transactions,” said Liddy.

Additional reporting by Lisa Lerer.

Lumbergh?

Star employees yesterday received a McClatchy Company form letter telling them that about 150 staff would be cut and that everyone is getting a pay cut. And you thought your day was bad.

The Source will leave the reasons for the breathtaking implosion of the Kansas City Star to another day. There is one question we keep asking ourselves though.

How many times can one company mishandle a downsizing?

As if the news itself is not enough to kill morale- the way in which McClatchy and the Star continue to let their employees twist in the wind borders on criminal. The news is delivered on a Monday, but instead of just ripping the band-aid off and getting the pain over and done with, The Star extends the agony.

Now employees get to keep working while wondering if they will get to keep their job with a salary decrease or whether they will need to apply to work in the Nixon Administration. Like Knute Rockne, Mark Zieman really knows how to get the best out of his players, doesn’t he? Job uncertainty doesn’t usually inspire people to work harder.

There is a reason that major companies fire people on Fridays. There is also a reason they announce who is leaving at the same time- instead of announcing the number of positions to quit.

Productivity will be at an all-time low this week for The Star as employees gather around the water cooler and ask one another in hushed tones, “What have you heard?”

Is it just us or does Mark Zieman bear a striking resemblance to Bill Lumbergh as a manager? It won’t be long before we hear about Barbara Shelly wondering around the office asking if anyone has seen her stapler.

Earmarks and Claire...

Far be it from the Source to take issue with David Goldstein’s “beat sweetener” story on Claire McCaskill opposing earmarks.

However, we cannot let this one go. The Star got rolled big time by Claire’s press operation.

Yesterday, Claire gave a major speech on the Senate floor. She railed against Republicans, she kind of railed against Democrats, she pounder her fist and shook her finger at the hypocrisy of Republicans complaining about spending, but accepting earmarks. She left us no doubt that she opposes earmarks and is all but a caped crusader against them.

Except that, she’s not.

On the SAME DAY as her speech, Claire voted to keep 13 earmarks in the bill for a company that was raided and clearly is under investigation by the FBI.

Roll Call reports it thusly:

“The amendment would have eliminated 13 provisions connected to the PMA Group lobbying firm, which was raided by the FBI in November as part of an investigation of potentially improper campaign contributions.

The vote on the PMA amendment was closer than expected, with a number of Democrats waiting until the waning moments to cast their votes. The two Colorado Democrats split their votes on the amendment, with Sen. Michael Bennet — who faces re-election in two years — voting for it, and Sen. Mark Udall, who has a full six-year term, voting against it.

Sens. Amy Klobuchar (D-Minn.) and Blanche Lincoln (D-Ark.) voted for Coburn’s PMA amendment. At the end of the vote, McCaskill voted with Democratic leadership and against Coburn, though she had spoken out against earmarks earlier in the day.

Prior to the vote, Coburn warned his colleagues that, “Anyone who votes against my amendment on PMA — they’re going to have a lot of ’splaining to do.”

The Amendment passed 52-43 to keep the projects in the bill. When Claire McCaskill had an opportunity to actually do something about earmarks- she simply voted the party line.

She’s betting that no media outlet has the guts to call her out on her blatant hypocrisy. The sad part is that she just might be right.

Most Expensive Catastrophes in History

11 Most Expensive Catastrophes in History

# 11. Titanic - $150 Million
The sinking of the Titanic is possibly the most famous accident in the world. But it barely makes our list of top 11 most expensive. On April 15, 1912, the Titanic sank on its maiden voyage and was considered to be the most luxurious ocean liner ever built. Over 1,500 people lost their lives when the ship ran into an iceberg and sunk in frigid waters. The ship cost $7 million to build ($150 million in today's dollars).

# 10. Tanker Truck vs Bridge - $358 Million On August 26, 2004, a car collided with a tanker truck containing 32,000 liters of fuel on the Wiehltal Bridge in Germany . The tanker crashed through the guardrail and fell 90 feet off the A4 Autobahn resulting in a huge explosion and fire which destroyed the load-bearing ability of the bridge. Temporary repairs cost $40 million and the cost to replace the bridge is estimated at $318 Million.

# 9. MetroLink Crash - $500 Million
On September 12, 2008, in what was one of the worst train crashes in California history, 25 people were killed when a Metrolink commuter train crashed head-on into a Union Pacific freight train in Los Angeles It is thought that the Metrolink train may have run through a red signal while the conductor was busy text messaging--Wrongful death lawsuits are expected to cause $500 million in losses for Metrolink.

# 8. B-2 Bomber Crash - $1.4 Billion
Here we have our first billion dollar accident (and we are on only #8 on the list). This B-2 stealth bomber crashed shortly after taking off from an air base in Guam on February 23, 2008. Investigators blamed distorted data in the flight control computers caused by moisture in the system. This resulted in the aircraft making a sudden nose-up move which made the B-2 stall and crash. This was 1 of only 21 ever built and was the most expensive aviation accident in history. Both pilots were able to eject to safety.

# 7. Exxon Valdez - $2.5 Billion
The Exxon Valdez oil spill was not a large one in relation to the world's biggest oil spills, but it was a costly one due to the remote location of Prince William Sound (accessible only by helicopter and boat). On March 24, 1989, 10.8 million gallons of oil was spilled when the ships master, Joseph Hazelwood, left the controls and the ship crashed into a Reef. The cleanup cost Exxon $2.5 billion.

# 6. Piper Alpha Oil Rig - $3.4 Billion The world's worst off-shore oil disaster. At one time, it was the world's single largest oil producer, spewing out 317,000 barrels of oil per day. On July 6, 1988, as part of routine maintenance, technicians removed and checked safety valves which were essential in preventing dangerous build-up of liquid gas. There were 100 identical safety valves which were checked. Unfortunately, the technicians made a mistake and forgot to replace one of them. At 10 PM that same night, a technician pressed a start button for the liquid gas pumps and the world's most expensive oil rig accident was set in motion.

Within 2 hours, the 300 foot platform was engulfed in flames. It eventually collapsed, killing 167 workers and resulting in $3.4 Billion in damages.

# 5. Challenger Explosion - $5.5 Billion The Space Shuttle Challenger was destroyed 73 seconds after takeoff due on January 28, 1986 due to a faulty O-ring. It failed to seal one of the joints, allowing pressurized gas to reach the outside. This in turn caused the external tank to dump its payload of liquid hydrogen causing a massive explosion. The cost of replacing the Space Shuttle was $2 billion in 1986 ($4.5 billion in today's dollars). The cost of investigation, problem correction, and replacement of lost equipment cost $450 million from 1986-1987 ($1 Billion in today's dollars).

# 4. Prestige Oil Spill - $12 Billion
On November 13, 2002, the Prestige oil tanker was carrying 77,000 tons of heavy fuel oil when one of its twelve tanks burst during a storm off Galicia, Spain. Fearing that the ship would sink, the captain called for help from Spanish rescue workers, expecting them to take the ship into harbour. However, pressure from local authorities forced the captain to steer the ship away from the coast. The captain tried to get help from the French and Portuguese authorities, but they too ordered the ship away from their shores. The storm eventually took its toll on the ship resulting in the tanker splitting in half and releasing 20 million gallons oil into the sea.

According to a report by the Pontevedra Economist Board, the total cleanup cost: $12 billion.

# 3. Space Shuttle Columbia - $13 Billion The Space Shuttle Columbia was the first space worthy shuttle in NASA's orbital fleet. It was destroyed during re-entry over Texas on February 1, 2003 after a hole was punctured in one of the wings during launch 16 days earlier. The original cost of the shuttle was $2 Billion in 1978. That comes out to $6.3 Billion in today's dollars. $500 million was spent on the investigation, making it the costliest aircraft accident investigation in history. The search and recovery of debris cost $300 million.

In the end, the total cost of the accident (not including replacement of the shuttle) came out to $13 Billion according to the American Institute of Aeronautics and Astronautics.

# 2. Chernobyl - $200 Billion
On April 26, 1986, the world witnessed the costliest accident in history. The Chernobyl disaster has been called the biggest socio-economic catastrophe in peacetime history. 50% of the area of Ukraine is in some way contaminated. Over 200,000 people had to be evacuated and resettled while 1.7 million people were directly affected by the disaster. The death toll attributed to Chernobyl , including people who died from cancer years later, is estimated at 125,000. The total costs including cleanup, resettlement, and compensation to victims has been estimated to be roughly $200 Billion. The cost of a new steel shelter for the Chernobyl nuclear plant will cost $2 billion alone. The accident was officially attributed to power plant operators who violated plant procedures and were ignorant of the safety requirements needed.

# 1. 2008 Presidential Election- $800 Billion in the first two months………